The $100 “Reduction”: 1131 W. Grace in Lakeview
Some sellers will do anything to drum up interest in their property.
Take the $100 “reduction.” Many of you have probably seen this. It’s where the seller reduces the price by $100 simply so it shows up on the MLS with a “reduction” or a “price change.”
Lots of people want to see the properties with price reductions, right?
So it keeps the property at the top of people’s lists.
Such is the case with this 2006 new construction 2-bedroom unit at 1131 W. Grace in Lakeview.
It’s been on the market since May, but starting in early September, the listing has been reduced $100 each week.
Does this selling technique work?
Here’s the listing:
Bring all offers! Extra-wide (37.5’) high-end luxury condo, garage parking included! Chef’s kitchen (SubZero, Viking, Bosch, cherry, granite). Master with separate steam shower, extra-large Jacuzzi, two bowl vanity.
Huge back deck (not through bedroom), Juliet balcony off living room. 10’ ceilings, beautiful architectural/woodwork details, hardwood floors, washer/dryer, fireplace, surround sound. Custom walk-in closets and blinds. Extra-large storage. Perfect location!
Laura Kirchner at Rubloff has the listing. See more pictures and a virtual tour here. See the property website here.
Unit #2: 2 bedrooms, 2 baths, 1500 square feet
- Sold in July 2006 for $490,000
- Originally listed in May 2008 for $539,000
- Reduced several times
- Listed in early Sept 2008 for $499,900
- Reduced $100 each week
- Now $499,500 (parking included)
- Assessments of $110 a month
- Taxes are “new”
- Central air
Yeah, I’ve noticed this. Pretty sleazy technique. I don’t think it works because the first thing I do is look at the original list price. If it’s not down by much I’ll even pull up the listing history. It’s pretty obvious what’s going on. I’ve even seen prices go up $100 to trigger the price change.
A much more common and somewhat more effective technique is to pull the MLS listing then relist the next day at a different price. Sites like Ziprealty can’t keep a running tally of the ask prices in situations like this.
Of course RE sleuths like many on this site can figure this out but I’d bet the majority of potential buyers aren’t RE sleuths so I’d imagine the yanking then relisting technique might be somewhat effective.
Might this be one of those places where I will be required to drag my bloody, raw steak and bottle of vin rouge through the bedroom to get to the outdoor cooker to cook the meat while slurping the wine? Or is the option the steak tartar my dear?
When are the developers going to get that hard and fast principle of proper, strategic deck placement.
Margo:
I assume (perhaps at my peril) that the realtor is not flat out lying when the listing says “Huge back deck (not through bedroom)”. So my answer to your question would be “no” and this developer got it. But, as I said, that’s trusting the untrustworthy.
The deck off the bedroom always seemed like a better deal for the developer than the home buyer.
One more thing, I never quite understood the $500k 2 bedroom in a 3 flat. They’re so ubiquitous and so ugly and they’re literally ‘everywhere’ on the north side.
The developers made out like bandits with these things. Cheap to build, same plans for every building. The developers somehow convinced buyers that doublewide triple-stacked brick trailers were worth ungodly amounts of money. It’s not like these units qualify as affordable housing either. There’s nothing special at all about them to justify the half a million price tag.
A lot of those 2 bedroom 3 flats are going to turn into the ghettos of the future is my prediction.
A bunch of 20-somethings bought them with toxic financing assuming prices would always go up. Additionally they thought it was worth the 250k premium to live in cool area to walk to the bars.
They should’ve stayed rented because once one has a family you’re exactly right: its not quite a house its more like a crowded apartment.
anon:
OK then “she came in through the bathroom window…” or
better put, “she hauled her steaks out through a window…”
because I just don’t see ingress/egress in the photos. and why the
heck don’t they just say where the gosh darn door is??? what does
not through the bedroom mean??? is this hogwarts? secret passages
and all?
I predict that public housing will make a vibrant return under our country’s next socialist administration. Except they won’t make the same mistakes of the past – substandard high rise housing in bad neighborhoods. This time around our great society can provide *luxury* high rise housing in bad neighborhoods. Fortunately, that housing has already been built in what used to be *skid row* a/k/a The South Loop. Being so close to downtown will give our lower classes a leg up in life’s journey to find a high income earning job and off the dole.
“what does not through the bedroom mean???”
Maybe the door is in the upstairs hallway?
“I predict that public housing will make a vibrant return under our country’s next socialist administration. Except they won’t make the same mistakes of the past – substandard high rise housing in bad neighborhoods.”
They should do it like in Canada – a few public housing units set aside in every building. And then mix it up further by renting some of them to people from the projects, and some to harmless senior citizens.
Yeah, that will work out well. Just what I want is to pay full price while I have to listen to the ghetto blaster paying nothing right next door to me all night long since they don’t work.
Good luck keeping that building from turning into the projects over time.
Because of course everything is better in Canada. Except the weather.
Yeah that token price reduction technique totally works. or at least it used to when there were a lot of lazy agents in the field. just making the listing show a price change would get it to hit in a lot of automated searches, which would get a few eyeballs looking at a stale property again, which would usually get a few calls. of course anyone could look up the history, but you would be surprised how many offers were made by agents who had obviously not done any homework, like even looking up previous listings of the same property. most people now are looking harder at the value equation and nothing is working except for the right price to start with.
$245,000
$245,000 is too high. This unit is only 1,500 sq ft. Which isn’t small but it’s not big either. There are probably 20,000 units exactly like this one within a 1.5 mile radius. I’d say $220,000 at the bottom of this bubble.
“$245,000 is too high. This unit is only 1,500 sq ft. Which isn’t small but it’s not big either. There are probably 20,000 units exactly like this one within a 1.5 mile radius. I’d say $220,000 at the bottom of this bubble.”
This thing will sell for $400k.
“This thing will sell for $400k.”
I’m sure this unit will sell for $400k to some knifecatcher. And that sets the comps for everyone else in the neighborhood. And the next comp will be even lower. And on and on through 2012-13 when the last of the Alt-A’s have reset and entered foreclosure.
“what used to be *skid row* a/k/a The South Loop”
Check your Chicago history–the last time there was a bona fide skid row (70s), it was along Clark Street, just NORTH of the river–the heart of present-day “River North”. There’s a reason there were so many surface parking lots there 10 years ago.
Margo:
You’re letting your contempt overwhelm your space visualization–the hallway next to the kitchen runs straight back to the door to the deck–the glass block in the deck pic is the “master” bath, the master BR is directly in front of it, the (quite small) 2d BR in front of that and the 2d bath (probably) right behind the kitchen.
Not to give the impression that I think the place is well laid out–I might be crazy, but I think that the box jutting into the kitchen (besdie the subzero) is the 2d bath shower. And waht is with the door from the kitchen to the hallway? That should either be open or used for additional cabinet/storage space–the door is a stupid PITA.
anon:
Thanks for clearing that up but how in the world did you know I failed space vizualization in 2nd grade? It’s still a goofy set up particular to newer construction. Toss up a few bricks and blocks mix in a little wood for a deck and call it habitable.
Margo:
Some of the crap is the result of the standard Chicago lot combined with the space needed to have the access stairs–it leaves a pretty constrained space (as far as layout) to have LR, Kitchen, 2 BR and 2 Baths. There are only so many ways to layout the squares (of any reasonable size) for 6 or 7 rooms (counting the baths as rooms) and all the utilities in a 20’x75′(+/-) box, even w/o accounting for the stairs.
I’m so learning anon. Being an East Coast girl we’re used to calling 1 acre cramped 🙂
My biggest gripe remains with the “balcony/porch” placement on most of these new buildings. Currently, we live in a 4 flat built in 2003. The front “porch” as I call it measures a respectable 16×6 all of which is useable space (read: big ol’ Weber baby and no bloody steaks in the MBR!) The “balcony” off the MBR is gratuitous but still nice for a chair and table. I am just so over these builder’s who erect a back “balcony” expecting us to buy into the belief that it is actually a “porch.” A pox on them!
Sorry anon, wrong again.
http://www.southloophistory.org/people/statestreet.htm
South State Street Skid Row (ca. 1929-2008)
Chicago’s Loop was once surrounded on the Near North, Near West, and Near South Sides by seedy neighborhoods populated by concentrations of transients, dive bars, burlesque houses, homeless shelters, and rooming houses. The South Loop version stretched along State Street from Congress Parkway to south of Polk Street, and remained entrenched from the 1930s through the turn of the 21st Century.
Remember the Pacific Gardens??? ah yes, that’s right.
HD:
You don’t want to start a “wrong again” war. It’s pointless and everyone loses. We get way too much of it already with Stevo.
Besides, your own response notes that there were **3** skid rows. So, yes, you are righter–but I wasn’t totally wrong and what the south loop was (post-70s) didn’t comport with my view of what a skid row is–it was just a slum/abandoned neighborhhod.
Yeah, I went a little overboard with the *wrong*.
s’okay, roomie. Your turn to buy the TP.
Maybe you can pick it up when you’re parking Stevo’s beemmer at work tonight.
hello all … Interesting, evidently the technique works … There are 25 comments here!
I invite you all to come see this listing. It is actually very nice and not cookie-cutter at all. There is a nice back hallway with full-sized side-by-side laundry and a back door to a very large porch. “not thru bedroom” is commonly used in the industry to let buyers know that it is not the bad design that many of you discussed. We actually just reduced the price to $475,000 … A $24,000 reduction. Thanks for your input.
So laura, how is “the industry” these days. And wow a 5% reduction to actually put it 3% below the 2006 peak bubble price! You’d be an idiot to NOT buy this place at such an amazing price!!!!!!!!
This guy is underwater. The stock market is down 50% and real estate in Chicago in 2006 was up 70% vs. 2000.
This seller is going to learn the old adage “buy low, sell high” the hard way. Why am I not surprised it hasn’t sold since October, nor will it sell anytime soon with these token price reductions.
400-500k is suddenly a lot of money again now that you need good credit and a sizeable downpayment on a property.
Bob, most people who bought with little or no down payments between 2004-2007 are underwater.
As “homedelete” states, most people who bought from 2006 on are not happy with their current position. What has happened to the real estate market, and the global economy for that matter, has been a shock to everyone. All we (realtors) can do is our best to help our clients, and there are many factors to balance when doing so.
“Margo” and “anon”, I am actually very trustworthy. You both have spent a lot of time commenting on the layout of this residence … maybe you should come haul your steaks and vino through the back door and see how it works for you.
Realtors could also help people get a nice “dose of reality” but we all know that won’t happen. I mean its not like they signed an exclusive deal to work with you or anything, what’s so bad with telling people like it is instead of sugarcoating things and making them continue to live in an alternate reality?
Laura, you claim to be trustworthy yet state: “What has happened to the real estate market, and the global economy for that matter, has been a shock to everyone.”
That is a falsehood.